KUALA LUMPUR (Sept 6): Printing and publishing firm Nextgreen Global Bhd has signed a letter of intent (LOI) with Japan-based Marubeni Corp to enter into a partnership for an upcycling project involving empty fruit bunches (EFB) from oil palm trees in Pahang to be converted to valuable uses. The project will be effected by Nextgreen’s subsidiaries.

Under the project, Nextgreen will be developing a new facility in Pahang, namely Green Technology Park (GTP). This will add to the current facility in Pahang — operated by its wholly owned Nextgreen Pulp & Paper Sdn Bhd — which holds the EFB upcycling facility with a capacity of 12,000 tonnes of EFB pulp per year.

Nextgreen is also planning to add another upcycling facility with a capacity of 100,000 tonnes per year of EFB pulp in GTP Pahang — the new Pahang facility.

In a filing with Bursa Malaysia on Wednesday, the group said it also plans to develop GTPs in other regions, including Sarawak and Johor.

“The LOI is to confirm the intent of partnership between Nextgreen and Marubeni on the project that upcycles EFB to pulp and valuable uses through subsidiaries, including but not limited to GTP development in other regions in Malaysia,” it said.

Marubeni, a Japanese trading and investment conglomerate, will work as the sole sales agent for EFB pulp, which is produced at the current Pahang facility and sold to any third party.

“Marubeni works as the sole sourcing agent for any type of pulp which is required by Nextgreen. Marubeni aims to serve Nextgreen to bring the appropriate quality of pulp at a reasonable price,” it said.

While providing Nextgreen with its knowledge and experience to implement GTP projects, Marubeni also intends to evaluate the possibility of financially participating in the new Pahang facility or other GTP projects.

“Nextgreen and Marubeni recognise well that there may be other business opportunities including but not limited to paper, tissue, pellets for fuel, fertiliser, in addition to EFB pulp,” it said.

Both parties will bear their own costs in connection with the studies and the preparation, negotiation and finalisation of the agreements contemplated, until the LOI expires in November 2024.

“Both parties will make reasonable efforts to execute formal contracts where possible, including a formal agency agreement for EFB pulp sales and pulp sourcing, before the expiry date of the LOI,” Nextgreen added.

At 3.29pm on Wednesday, shares in Nextgreen rose two sen or 2.15% to 95 sen, for a market capitalisation of RM808.38 million. Year to date, the stock has risen 26.67% from 75 sen.

Source: TheEdge​